Investments

Fiduciary Transactions

Fiduciary transactions, or trust operations, are useful for customers, who would like to entrust the bank to invest their funds confidentially and securely on its behalf. Investment can be aimed whether at the real sector of economy by providing loans, or at acquisition of share capital, securities and financial markets.

In fiduciary transaction, the bank is a customer’s investment agent – the funds are invested into the customer’s chosen asset under pre-agreed terms and conditions on behalf of the bank.

Fiduciary transactions have a number of advantages as compared to direct investment:

• Confidentiality and security
  A customer is not a direct creditor; he is insured against loan-related influence from a borrower or third parties on his business.

• Legal support
  Depending on a situation, the bank’s specialists will offer the most suitable type of transaction, corporate structure and prepare appropriate documentation. The bank can also assist with processing security deposits and/or other collaterals; it can also act on behalf of a customer in corporate meetings and perform other delegated tasks.

• A customer receives all investment income
  A customer pays an agreed remuneration to the bank, thus, the customer can appraise expenditures precisely.

• A third party can be authorised to receive income
  A customer can assign a third party beneficiary, including children or relatives, to receive income, having agreed terms and conditions of payment procedure with the bank; the option allows to create an analogy of heritable or purpose trust.

To execute a fiduciary transaction, it is necessary to have enough funds on a current account in the bank, documents confirming the legitimate origin of the funds, and to provide description of the transaction to be executed to the bank.

If investments provide loans, the bank does not require to open a current account of a borrower, where the legislation of the borrower’s country of registration complicates the process.

For further information please contact Financial Markets Legal Division of Rietumu by phone +371 67025235 or e-mail fiduciary@rietumu.lv, your personal banker or regional manager.